When Gandalf first approaches Bilbo regarding this proposition on 25 AprilT.A.2941, the Hobbit wants nothing to do with such sort of "adventure". However, Gandalf leaves a mark on the door of Bag End to direct the rest of the Dwarves willing to embark on the quest for meeting there the following day. It soon becomes clear that Gandalf has volunteered Bilbo to be a "burglar" for the Dwarves on their adventure. The Hobbit protests, and the Dwarves grumble that the soft little Hobbit does not seem suited to their adventure. Gandalf, however, is certain that Bilbo is useful, and insists that there is more to Bilbo than meets the eye. Despite his strong objections to going on the journey, Gandalf forces Bilbo out the door the next morning as the Company begins their quest.

When the Company finally reaches the Lonely Mountain, they enter through the secret Back Door once the last light of Durin's Day reveals its keyhole. Having been designated the "burglar" for the group, Bilbo is assigned to go inside and "burgle" something for the Dwarves. The Hobbit comes across the great Dragon lying atop the Dwarves' great treasure hoard, and ultimately steals a golden cup from the hoard. Having wrongly surmised during their conversation that Bilbo was a Lake-man, Smaug flies off in a rage to lay waste Lake-town as revenge for Bilbo's intrusion. The fire-drake almost completely destroys the town, but not before being slain with a Black Arrow by one of its residents, whose name was Bard. With the Dragon now dead, the Dwarves could once again regain domain over the Mountain and their quest was complete.

Once the death of Smaug had reached lands beyond the immediate region, Bard, who had been anointed leader of the Lake-men, came to the Lonely Mountain to demand compensation in gold from Thorin in order for his people to rebuild their lives. Thranduil, king of the Woodland Realm, also came seeking a share of the treasure. When Thorin refused to part with any of the hoard, it led to the Battle of Five Armies, which was not only further complicated by the arrival of both a Goblin and Warg army seeking revenge for the death of the Great Goblin at the Company's hands, but also cost Thorin his own life (as well as his nephews and most immediate heirs to the throne, Fíli and Kíli). In their place, Dáin Ironfoot became the new King under the Mountain.

Years later, it would be revealed that the ring Bilbo had taken from Gollum in the Misty Mountains would in fact turn out to be the One Ring which had once belonged to Sauron, for which he now had his servants scouring all over Middle-earth. It would lead to not only the Quest of the Ring but also the War of the Ring and, ultimately, the end of the Third Age.

In the second Hobbit film it is said that the entire Quest was to retrieve the Arkenstone, as possessing it would give Thorin the authority to unite all the Dwarven clans to march on the Erebor, and reclaim it from the Dragon Smaug.